On December 29, the DVD copy control association filed suit in California against 72 people, charging them with disseminating trade secrets—specifically, distributing software called DeCSS. This utility cracks CSS (Content Scrambling System), a copy-protection algorithm built into the DVD-Video standard. The following month, the Motion Picture Association of America (MPAA) filed its own suits against three defendants in New York, charging them with violating the 1998 Digital Millennium Copyright Act for posting the DVD hack on the Web.

The outcome of these cases may redefine what constitutes piracy and whether consumers will have any say in how they can use copyrighted content.

The defendants and their supporters in the open source software community argue that DeCSS allows Linux users merely to access the content on DVDs—putting them on equal footing with Windows or Mac OS users. "The process of reverse-engineering and public posting and commenting of code that the MPAA is attempting to suppress is fundamental to the development of commercial and open source software," says Tara Lemmey, executive director of the San Francisco–based Electronic Frontier Foundation. "The motion picture industry is using its substantial resources to intimidate the technical community into surrendering rights of free expression and fair use of information."

The MPAA counters that by circumventing copy protection, the hackers are jeopardizing nothing less than "the future of American movies" by facilitating piracy.

These lawsuits demonstrate that old-school thinking about the nature of intellectual property is increasingly on a crash course with the open source movement—and, many argue, with a concept of "property" that makes allowances for public access rather than fencing it off.

Fighting the Tide

The numbers are sobering. The Recording Industry Association of America (RIAA) claims piracy costs the U.S. recording industry hundreds of millions of dollars each year. And the International Federation of the Phonographic Industry claims illegal music duplication costs the industry $4.5 billion a year worldwide.

The Business Software Alliance (BSA), which represents most major computer software publishers, estimates that piracy cost the software industry $11 billion in lost revenues during 1998 alone. The Software & Information Industry Association recently conducted a survey that found that approximately 60 percent of the software distributed on Internet auction sites is counterfeited (an internal Micro soft study found the volume of auctioned fakes much higher, at 90 percent).

But is the potential economic bite as dire as the industry watchdogs contend? Many people think not.

"There are a lot of good arguments to be made for unpaid exposure to copyrighted works," says Julie E. Cohen, an associate professor at the Georgetown University Law Center. She compares " 'fair use' . . . sharing of copyrighted material" to word-of-mouth marketing. "It gives much broader exposure and can encourage 'the unauthorized user' to buy the next version later."

And practically all of the supposed costs and lost revenues bemoaned by the RIAA and BSA aren't really lost, since by definition pirated music or software doesn't cost the original creators a dime: The pirates copy the material with their own duplication equipment and media.

Nobody has ever successfully demonstrated that people would uniformly pay for all the content and software they had received for free if pirated copies didn't exist. Indeed, the opposite seems to be true: Many people will install Photoshop from a friend's CD-ROM only because they can, not because the application is essential or even useful to them.

"I have tons of programs on my computer that I've never even launched," says one 30-something from Montana who asked not to be identified. "I figure I might want them someday, and a friend who got the stuff for work let me copy them for free."

What about the applications he uses often? "I'm willing to pay for the software so long as 'the price is' not in the stratosphere," which he defines as more than $150.

Even that price may be out of reach for some consumers. "Particularly in some other countries where people can't afford American prices, it's not fair to say that every single one of those copies would have translated to a sale," Cohen says.

Lynn Winebarger, founder of Free- Expression.org, a project that aims to build a range of free video- and audio-streaming tools under a general public license, agrees. "To support 'the BSA's' claim," she says, "they'd have to show that if all copyright infringement were stopped, their revenues would increase by $11 billion."

But these types of circuitous observations don't sit well with many content and application creators. These days, companies go to ever-more-extreme lengths to protect their handiwork. Microsoft's Windows 2000 operating system software has no fewer than three layers of antipiracy security: an edge-to-edge hologram on installation CDs (which makes them exceedingly difficult to counterfeit); a registration tag that is attached to the specific computer the software is installed on; and a controversial registration key code—half of which comes with the physical software bundle and half of which the licensee must contact Microsoft to get.

Industry associations go to a great deal of trouble to ferret out pirates. The RIAA considers pirate hunting to be "perhaps 'our' most important mission." To that end, the organization expends considerable effort to track down and sue pirates big and small. The organization even asks consumers and businesses to rat on suspected music pirates by calling a piracy hotline. Those who turn in music pirates can score a reward as high as $10,000.

Beyond industry interest groups, companies such as NetRecovery Solutions of Ottawa, Illinois, and England's Copyright Control Services act as digital private investigators, scouring the Web for pirated content. According to David Powell, CEO of Copyright Control Services, business has never been better. "We're seeing a tremendous upsurge in piracy," he says. "What was a problem a year ago is a matter of compelling urgency today."

Because hackers tend to regard copy protection as an inviting puzzle, technology alone will never be the answer. The challenge for the content business will be balancing technological deterrence and enforcement of existing laws with the public's right to fair use—and with human nature. After all, there will always be those who'll do anything to get something for nothing.

On the Scope

IN

AOL GOES WIRELESS Thanks to a new agreement between AOL and RTS Wireless, soon you'll be able to get spam and chain letters anywhere—even when you're at the beach.

DEMOCRACY OR DENIAL OF SERVICE? Arizona makes history by letting residents place their votes online, then makes history again when the site virtually crashes under the load.

E-NDIGESTION McDonald's announces its investment in Food.com. No word on whether Ronald & Co. have influence on the site's, er, content.

OUT

OLD DOMAIN NAMES Praised as heralding a return to sanity for company names, InfoSpace drops the ".com" from its corporate identity.

NEW DOMAIN NAMES Meanwhile, two Ralph Nader-run organizations propose 10 new top-level domains, including .union, .isnotfair, and .sucks. Sorry, Nader .sucks is already taken.

ADDRESSING THE REAL PROBLEM Nintendo agrees as part of a settlement to drop $80 million on protective gloves for gamers who find frantic button-pushing has given them blisters.